Australia Post's New Year postal rate increase on commercial mailing of an average of 3.7 percent from January 3 next year is the latest in a series of price hikes inflicted on the direct marketing, mailing and printing sectors. Despite introducing three tiered services this year, the post monopoly is again targeting commercial mail to make up its losses.
The rises are roundly condemned by mailing houses as well as Printing Industries as an attack on the viability of the sector. They come as moves are underway to revive the Major Mail Users Association to act as a 'push back' against further unwarranted increases.
The largest increases are in PreSort, at 5.1 percent, Clean Mail, at 4.4 percent, and Print Post, at 4.0 percent. Ordinary letter prices will remain the same, as will Promo Cost barcoded rates, Acquisition Mail, Sample Post, and Impact Mail.
Andrew Macaulay, PIAA CEO, condemned the price rises as part of Australia Post's 'assault' on the printing industry. "It’s disappointing as usual that a monopoly government operation is increasing prices and taking advantage of efficiency gains from its major customer instead of finding some itself," he said.
Andrew Bye, Account Executive Postal Partners at Australia Post, announced the price changes in an email to customers, saying they were necessary to maintain services. "While we understand that price changes aren’t easy for you, regular pricing reviews are just one part of sustaining your high quality, national mail delivery service," Bye said, adding that despite exceeding cost reduction targets in the 2015-16 financial year, the postal business still recorded a $138 million loss.
"We will continue to support the mail communication channel, manage our product portfolio and remain committed to achieving further operational efficiencies and cost savings. It is critically important that we address all of these factors to help make letters sustainable into the future," Bye said.
The business price hike follows Australia Post's decision to increase the cost of a standard postage stamp from 70 cents to $1 in January this year, while at the same time taking up to two days longer to deliver a standard letter. The company also introduced a "priority" service, which delivers letters at the earlier speed for an extra 50 cents.
Ahmed Fahour, Australia Post Managing Director and Group CEO, said last year that the changes would sustain the loss-making postal business. "It will also allow Australia Post to recover more of the cost of the service while maintaining five-day a week delivery and continuing to meet our important Community Service Obligations," he said.